Aug. 27, 2010 - Containerboard producers reportedly have realized $40/ton of the $60/ton price hike that was announced for early August. This follows hikes in January and April totaling $110/ton, said analysts at Deutsche Bank who cover the paper and forest sector.

According to senior analyst Mark Wilde at Deutsche Bank, the remaining $20 will remain “open” to September.

“Prospects for the balance of the hike are decent, but it will be a fight. The critical issue is the ability/determination of the large [integrated producers] to push downstream box increases.

“This is the third price increase of the year after the $30/ton increase in January and $35/ton in April,” he added.

Wilde pointed out that at current levels, prices are up 15.6% from year-ago levels.

NOTES

RockTenn recently announced a $50/ton price increase on its Millenium CRB grade, effective Sept. 13. URB prices were flat at $610-640/ton in August after two rounds of price increases of $30/ton in February and $40/ton in April.

While supply demand dynamics support the current price increase, $60/ton decline in OCC prices from March 10 levels could make it difficult for producers to push through the remaining $10-20/ton increase rapidly.